Which of These Conditions Is NOT Necessary for the Economic

question 45

Multiple Choice

Which of these conditions is NOT necessary for the economic order quantity model to be valid?

• A) The item has a constant demand.
• B) The item has a constant lead time.
• C) The item has a constant price.
• D) The item has a constant safety stock.

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Definitions:

Equipment

Tangible property used in operations, such as machinery or computer hardware, which can often be depreciated for tax purposes.

Capital Asset

A long-term asset such as equipment, real estate, or securities, which is not easily sold in the regular course of a business's operations for cash.

Taxpayer's Home

The primary place of abode of a taxpayer that determines tax liabilities and benefits.

Loss Carryforward

A tax provision that allows taxpayers to use a current year's losses to reduce taxable income in future years.